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CONTRACTS CAN DESIGNATE ENERGY RESPONSIBILITY

How the benefits and burdens are shared between the equipment purchaser and the site management is a function of the contract, and this allocation may in fact change as the expenses of either party change as a result of subsequent events, such as changes in electricity prices or standards requiring more efficient machines.

Unfortunately, the language contained in vending contracts tends to vary widely.

In most vending machines, energy consumption depends on internal temperature and lighting factors as well as ambient temperature, which contribute to the overall heat load of the equipment. It is interesting to note that most practitioners believe that since a beverage vending machine has a closed refrigeration system, its operation will not be significantly influenced or impacted by ambient temperature. This simply is not the case.

Generally, where commissions are involved, the operator agreement with the site client may stipulate that a portion of the commission is intended to reimburse the client for space and power. As a consequence, the vending industry may include a facility rental income (FRI) clause that clarifies the payment revenue stream is intended to cover expense liability.

THE FACILITY RENTAL INCOME CLAUSE

In the past several years, some site clients have begun preparing a location request for proposal for a vending contract that challenges potential vendors to provide an energy-efficient vending machine. Compared to a traditional vending machine, an energy conserving model is not only more environmentally friendly, but typically does so without an appreciable difference in capital cost.

The goal is to combine business and environmental concerns into a mutually beneficial agreement. As a result, some clients are building vending contracts with specific language that delineates the responsibilities of each party.